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The Patient Protection and Affordable Care Act passed signed into law by President Obama impacts providers in several ways. One of the areas of impact to providers is the expansion of the Recovery Audit Contractor (RAC) Program.

The Act expands the RAC Program to Medicaid by requiring that each state contract with at least one RAC to identify underpayments and overpayments. These contracts must be in place no later than December 31, 2010. The Act also expands the RAC Program to Medicare Parts C and D by the end of this year.

The Reconciliation Act of 2010 may cause some changes to the Act, however, if it is passed in its current form the RAC Program will still be expanded to Medicaid and Medicare Parts C and D.

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For the first time, Michigan providers must charge patients less than the previous year for copies of medical records. The Michigan Medical Access Act of 2004 regulates the access to and disclosure of medical records. Under the Act, the Department of Community Health has the responsibility to adjust on an annual basis the fees that may be charged by a Michigan provider to any patient requesting copies of medical records. The adjustment is based on the Detroit Consumer Price Index. This year, for the first time the fee has been decreased from the previous calendar year. In CY 2009, the initial fee for copies was $22.08, but in CY 2010, the initial fee is $21.95.

For more information, please visit www.wachler.com or contact a Wachler & Associates attorney at 248-544-0888.

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The Notice of Proposed Rulemaking (NPRM) was issued in order to establish programs by which health IT technologies will be tested and certified. Such programs were mandated by the HITECH Act, which provides incentive payments to providers who demonstrate meaningful use of certified electronic health record (EHR) technologies. Companion regulations have also been introduced which propose standards and criteria that will be necessary to demonstrate meaningful use and which propose the functional capabilities that EHR technologies must have in order to be eligible for certification.

The NPRM proposes a temporary certification program for EHR systems and modules, and lays the foundation for a permanent program that will eventually replace the temporary program. The temporary program is designed to ensure that certified technologies are in place so that providers may take advantage of the incentive payments at the earliest opportunity before the permanent program has been fully implemented.

The NPRM comes after the initial meaningful use NPRM and the Standards & Certification Interim Final Rule (IFR), published in January 2010. The Standards & Certification IFR establishes an initial set of standards, implementation specifications, and certification criteria for Complete Electronic Health Records (EHR) and EHR Modues for aodption by the HHS Secretary. The Certification Programs NPRM and the Standards & Certification IFR will operate jointly to create confidence in the security and effectiveness of electronic health IT produces and systems.

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A final rule published by the Department of Health and Human Services expanded the scope of the National Practitioner Data Bank to now include disciplinary information on all licensed health care professionals, including nurses, podiatrists, chiropractors, and physician assistants. Prior to this new rule, the databank, established under the federal Health Care Quality and Improvement Act of 1986, collected adverse findings only against physicians and dentists by state licensing agencies and credentialing bodies. Similar information involving other health professionals was collected in a separate reporting database.

Please see the attachment to read the final rule.

For more information, please visit www.wachler.com or contact a Wachler & Associates attorney at 248-544-0888.

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On Monday March 1st, a 21% Medicare physician payment cut went into legal effect. However, the Obama administration directed Medicare billing companies to stop processing claims for 10 business days in order to provide lawmakers with extra time to create a solution. On March 2, 2010, Kathleen Sebelius, Secretary of the Department of Health and Human Services, addressed the American Medical Association (AMA) and assured members that she was committed to developing a permanent fix to the sustainable growth rate (SGR) that controls Medicare payments to physicians.

For more information, please visit www.wachler.com or contact a Wachler & Associates attorney at 248-544-0888.

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On January 5, 2010, Governor Jennifer Granholm signed legislation that expands the chiropractic scope of practice in the state of Michigan. The expansion is designed to restore the scope of practice that existed prior to when the Public Health Code was rewritten. Chiropractors in Michigan may now treat neuromuscular, skeletal and joint disorders throughout the entire body.

The Public Health Code now defines the “Practice of Chiropractic” as the discipline within the healing arts that deals with the human nervous system and the musculoskeletal system and their interrelationship with other body systems. The scope of practice also now includes the diagnosis of conditions and disorders of the human musculoskeletal and nervous systems as they relate to subluxations, misalignments, and joint dysfunctions. To evaluate the conditions or symptoms related to these conditions, a chiropractor may order advanced radiology scans if those scans were within the scope of practice as of December 1, 2009.

For more information, please visit www.wachler.com or contact a Wachler & Associates attorney at 248-544-0888.

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On February 19, Michigan Governor Jennifer Granholm issued an Executive Order creating an independent Office of Health Services Inspector General (OHSIG) within the Department of Community Health. The Executive Order will become effective on October 1, 2010. Governor Granholm will have the responsibility to appoint the Health Services Inspector General.

The OHSIG will further the state’s fight against fraud by consolidating the responsibilities into one independent office. According to the Governor, this will ensure that the office will be able to focus on specific auditing and fraud prevention goals. The Executive Order grants the Inspector General’s Office with broad powers to carry out these tasks.

For more information, please visit https://www.wachler.com/ or contact a Wachler & Associates attorney at 248-544-0888.

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Connecticut Attorney General Richard Blumenthal filed suit against Health Net of Connecticut, Inc. for its alleged failure to secure private medical and financial information involving 446,000 Connecticut enrollees.

The Health Information Technology for Economic and Clinical Health (HITECH) Act authorizes state attorneys general to bring actions on behalf of the public in order to enforce HIPAA. The Connecticut Attorney General’s case against Health Net is the first action by a state attorney general brought pursuant to this authority.

The case alleges that Health Net exposed protected health information and other personal information and failed to promptly notify appropriate authorities of the incident. The information had been saved on a portable computer disk drive, but, despite Health Net’s policies and procedures, had not been encrypted. The computer disk, which contained approximately 27.7 million scanned pages of hundreds of different types of documents, had been missing for approximately six months before Health Net took steps to notify the Attorney General and affected individuals.

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February 22, 2010: In a report released last week, CMS revealed that Recovery Audit Contractors (RACs) referred two cases of potential fraud to the Department of Health and Human Services Office of Inspector General (OIG) during the RAC Demonstration Program between March 2005 and March 2008.

The published report states that fraud detection was not a part of the scope of work for demonstration RACs. However, RACs were to report claims that they determined to be potentially fraudulent to the CMS Project Officer. The CMS Project Officer had the responsibility to send the referrals to the Program Integrity Group at CMS to determine if the referral should be sent to the PSC and/or law enforcement.

The two cases of potential fraud referred by RACs to CMS during the demonstration project were sent by one RAC. The RAC reported the potential fraud to the CMS Project Officer. According to the RAC’s report to CMS, it did not have contact with the providers with regards to the potential fraud and completed its review of the providers.

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February 2010: In November 2009, the U.S. House of Representatives passed the Medicare Physician Payment Reform Act of 2000, a bill that blocks a 21.2 percent physician-payment cut. Specifically, the bill would amend the Social Security Act to reform the Medicare Sustainable Growth Rates (SGR) payment system for physicians. The SGR was originally created in 1997 to control Medicare spending by cutting payments to doctors if costs exceeded predetermined levels. Only in 2002 did lawmakers allow payment cuts to take place. In other years, lawmakers intervened to prevent payment cuts in order to prevent doctors from leaving the Medicare program. According to the American Medical Association (AMA), if the bill fails to pass, the payment cut for physicians could grow to about 40 percent by 2016. Proponents of the bill argue that such payment cuts will cause fewer doctors to accept Medicare patients and that it is time to implement a permanent fix.

The bill was placed on the Senate Legislative Calendar on December 24th, and read for a second time on January 20th. There is speculation, however, as to whether the bill will be passed in the Senate. Opponents to the bill argue that it will increase the federal government’s already record-breaking budget deficit. An additional hurdle the bill must overcome is its characterization by some as part of the Administration’s effort to overhaul the healthcare system. This depiction brings the effort into controversial political territory, thus making the effort to have it passed more difficult.

For more information please visit our website, https://www.wachler.com/, or contact a Wachler & Associates attorney at 248-544-0888.

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